Adnams reveals 10 per cent profits dip

Adnams, the Suffolk brewer and pub operator, has reported a slide in annual pre-tax profits of 10 per cent, although it maintained operating profits at 2009 levels.

The Southwold-based group, which operates 70 tenanted pubs, said turnover for the year to December 31, 2010, was marginally down at £50.9m, while operating profits were steady at £3.2m.

Pre-tax profits were down 10 per cent at £2.8m, thanks in part to lower profits from pub disposals and higher interest charges. The group said it would pay an unchanged dividend of 122p per share.

It said its cash inflow of £496,000 left its balance sheet in good shape, while its profits covered its interest payments seven times.

Adnams said it had been hit by poor weather in both halves of its financial year, although the second six months of the year were stronger than the first.

The group did not specifically comment on the performance of its pub estate or its brewing operation, although it noted that its hotels business had experienced a difficult time in 2010, especially in periods of bad weather.

Its foray into spirits distilling was proving successful, the group said, while it planned to roll out further Cellar & Kitchen stores from the current portfolio of 10 shops in order to justify the centralised overheads needed to run the business.

While the economic outlook for 2011 remained uncertain, the brewer's chairman Jonathan Adnams said the group's balance sheet and brand reputation were strong "and we have the team in place to grow, develop and innovate".